Canada Stocks Climb as Crude Rallies on Ukraine TensionEric Lam
Canadian stocks rose the most since February as commodity producers rallied on a jump in copper and crude prices on concern the crisis in Ukraine is escalating and better-than-expected economic growth in China.
Canadian Natural Resources Ltd. and Calfrac Well Services Ltd. paced gains that sent energy shares to a three-year high. Osisko Mining Corp. added 7 percent, reaching the highest in more than a year, after announcing a joint sale to Agnico Eagle Mines Ltd. and Yamana Gold Inc. in an effort to fend off a hostile Goldcorp Inc. bid. Torex Gold Resources Inc. increased 13 percent after securing financing for a mining project.
The Standard & Poor’s/TSX Composite Index rose 142.60 points, or 1 percent, to 14,446.52 at 4 p.m. in Toronto, the biggest increase since Feb. 6. The equity benchmark is up 6.1 percent this year and has recovered most of a 1.4 percent dip between April 2 and April 11.
“The market has acted very well for Canada this year and we had been due for a correction, hopefully we’ve had it now,” said John Kinsey, a fund manager at Caldwell Securities Ltd. in Toronto. The firm manages about C$1 billion ($909 million). “We think it will be a good year for the Canadian market. Energy has been consistent and any prices over $100 is very good for Canadian companies.”
Brent crude climbed above $110 a barrel for the first time in six weeks and West Texas Intermediate traded near $104 a barrel as Ukraine’s government began an offensive against separatists in its east.
First Quantum Minerals Ltd. added 1.7 percent to C$20.99. Copper rose the most in two weeks as China’s economy grew 7.4 percent in the first quarter, ahead of the median economists’ estimate of 7.3 percent.
Canadian Natural Resources rose 0.7 percent to C$44.08 and Calfrac Well Services gained 2.6 percent to C$35.73 as the S&P/TSX Energy Index climbed 1.4 percent for the highest close since May 2011.
Precision Drilling Corp. jumped 6.6 percent to C$13.76 after analysts at Morgan Stanley raised their rating for the stock to overweight, the equivalent of a buy, as the company is positioned to “capture outsize share” of natural gas drilling activity in the coming years.
Metro Inc. increased 2.5 percent to C$65.86 as consumer staples shares rose 1.4 percent as a group. All 10 industries in the S&P/TSX advanced on trading volume about 17 percent higher compared with the 30-day average.
Metro, the grocery store retailer, reported second-quarter adjusted earnings of C$1.07 a share, ahead of analysts’ estimates of C$1.03 as same-store sales rose 1 percent.
Osisko jumped 7 percent to C$7.94, the highest since January 2013. Agnico Eagle and Yamana’s C$3.9 billion cash-and-stock offer, valuing Osisko at C$8.15 a share, trumps a hostile bid from Goldcorp for C$7.43 a share. Osisko and Yamana had first agreed to a friendly deal on April 2. The fight for Osisko is focused on its Canadian Malartic gold mine. Agnico Eagle slumped 8.2 percent to C$30.71, the biggest decrease in a year, Yamana sank 4 percent to C$8.83, while Goldcorp added 0.8 percent to C$26.22.
Torex Gold soared 13 percent to C$1.13. The Toronto-based company said it has signed a commitment letter with a series of banks for a $375 million project finance facility, enough to fully finance the development of its El Limon-Guajes project in Mexico.